Insights
Amazon is Killing your Small Business. Here's How to Stop it.
11.1.2021
An upside-down Amazon logo forms a sad face depicted on the side of a shipping box.

It’s no secret that Amazon is an incredibly influential company. When the whole world was stuck at home starting in March 2020, people turned to Amazon to buy everything from furniture to groceries. Demand was so high that it led to extensive shipping delays and the company’s revenue jumped 35-40% in the months that followed.

While Amazon (and Jeff Bezos) have reaped the profits from the pandemic, small businesses closed at a staggering rate. Many businesses had limited diversification in terms of sales channels, and when people stopped walking in their stores, their revenue dried up. 

If you’re one of those businesses that has survived the pandemic, I applaud you. I can’t imagine some of the sacrifices you had to make to get to this point. But if there’s one thing we can take from this pandemic, is that it was a wake up call for the future of business. 

Here are five things you can do to help your business weather any future storms, and take back a slice of pie from Amazon.

1. Invest in your web presence
E-commerce has never been more popular. As the years go by and more people have equitable access to technology and high-speed internet access, shopping online will become even more prevalent than it already is. If your business doesn’t have the ability to sell products online, you’re losing money. It’s that simple.

Investing in a well-designed easy-to-use website is not only a form of advertising in creating trust, but it gives people options on how they want to shop. This is especially important if your business is based in a rural area, or a street without significant foot traffic. Have questions about what this process looks like? We can help.

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In 2019 we were involved in the evolution of Obasan.ca to evolve their E-commerce website. A streamlined and improved user and visual experience lead to increased sales and customer satisfaction.

2. Don't try to compete solely on price
Competing on price alone is usually a losing battle against giants like Amazon who have more brand awareness and advertising spend that convinces people to choose them over smaller retailers. They also optimize every part of their business to minimize sale prices while still keeping margins high. The speed, capacity, and overall low-cost of their warehousing and fulfillment operations alone are something that no small business can match.

3. Instead, offer something Amazon can't
What Amazon can’t compete on is design and experience. While their website has been optimized for speed and ease-of-use, it is ultimately a very unappealing experience and does little more than give you an easy way to buy things. If your store experience, whether that be digital or physical, is unique, interesting, and memorable, you’re already one step up on the competition. In fact, according to thinkJar Research up to 55% of consumers will pay more money for a product or service if it's a guaranteed good experience.

4. Create a personal relationship with customers
Studies show that businesses who (at least attempt to) make a personal connection with their customers see more repeat business, and are more likely to be recommended to others. For physical locations, asking customers their name or chatting about their day can go a long way in improving their perception of your business. For digital platforms, sending a personalized message or a physical note with shipped orders is one of many ways to break down the screen barrier.

It’s all about treating people with courtesy and respect. You’d be surprised at how something this simple goes a long way.

5. Prop up your local business community
Consumer’s appetite for buying local has never been higher. Because of this, you and your local business owners are all in the same game of getting as many people to shop locally as possible. If more people visit the neighbouring store, more people will probably visit your store too. You might even find ways to collaborate with neighbouring businesses on how you can both support each other. By thinking of your neighbours as friends rather than competitors, you both can benefit from your shared effort.

The reality is, Amazon is here to stay and it's only getting bigger. We hope that these tips will at least get you thinking about ways to improve your business and marketing efforts, so you can reap the rewards and have your best year of sales yet in 2022.

Best,
Vernon


Did you like some of the ideas in this article but aren't sure where to start? Send us an email at hello@vernon.studio. We'd be more than happy to help.